China's Chemical and Biological Weapon-Related Exports to Iran

Summary

Beginning in the early 1990s, reports of chemical weapon related sales from Chinese companies to Iran began to surface, and US officials became concerned that Chinese these exports could assist Iran's suspected chemical weapon program. Some reports suggested that Chinese companies transferred equipment and materials that would allow Iran to indigenously produce chemical weapons. The concern regarding China's exports to Iran were strong enough to lead the Defense Department in 1997 to report that:

"China is an important supplier of technologies and equipment for Iran's chemical warfare program. Therefore, Chinese supply policies will be key to whether Tehran attains its long-term goal of independent production for these weapons." [Office of the Secretary of Defense, Proliferation: Threat and Response, November 1997 (online version).]

In connection to these alleged transfers to Iran, the US first imposed CW-related nonproliferation sanctions on China in 1997. The US has since engaged China in several rounds of negotiations aimed at improving Chinese exports controls on sensitive chemical items. As a result China has adopted a comprehensive series of exports control laws covering chemical items. The Chinese argue their main difficulty has been the inability of the central government to control exports from Chinese chemical companies given the large and dispersed nature of China's chemical industry. Given the fact that the chemical industry is a "pillar industry" for China, it is unclear whether China's position is an excuse or a valid explanation.

China does appear to be making some progress on controlling exports of controlled chemical exports. In April 1999 testimony before a Congressional committee, John Lauder - the then head of the CIA's Nonproliferation Center - described the CIA's views on recent progress and continuing concerns about China's nuclear, chemical and missile proliferation activities. He specifically mentioned that Chinese chemical exports are less an issue of concern than in previous years. He stated:

"The China story is a mixed picture. China is actively studying membership in the Missile Technology Control Regime, has promulgated controls on dual-use nuclear technology, and tightened chemical export controls. We cannot yet be certain, however, that the new export control mechanisms will be effective, and worrisome contacts continue between Chinese entities and countries of concern."
"Both the Chinese Government and Chinese firms have long-standing and deep relationships with proliferant countries, and we are not convinced that China's companies fully share the commitments undertaken by senior Chinese leaders. While all aspects of China's proliferation behavior bear continued watching, we see more signs of progress on nuclear and chemical matters than on missile assistance." [Unclassified Statement for the Record by Special Assistant to the DCI for Nonproliferation John A. Lauder on the Worldwide WMD Threat to the Commission to Assess the Organization of the Federal Government to Combat the Proliferation of Weapons of Mass Destruction (aka The Deutsch Commission), 29 April 1999.]

In a February 2001 CIA report to Congress, the current status of the China chemical trade is described:

"Prior to [December 1999], Chinese firms had supplied CW-related production equipment and technology to Iran. ... Evidence [as of the beginning of 2000] suggests Iran continues to seek such assistance from Chinese entities, but it is unclear to what extent these efforts have succeeded. In June 1998, China announced that it had expanded its chemical export controls to include 10 of the 20 Australia Group chemicals not listed on the CWC schedules."

REPORTS, ALLEGATIONS, AND SANCTIONS

The first in a string of incidents involving Chinese chemical transfers to Iran occurred in 1993 when the US forced the inspection of a Chinese ship called the Yin He (Galaxy) after US intelligence agencies claimed that chemical precursors (possibly thionyl chloride and thiodiglycol) were loaded aboard the vessel in China before being shipped to Iran. After forcing the ship off the high seas and into a port in Abu Dhabi, the final inspection of the ship determined that no chemical precursors were aboard. Following the Yin He incident, China stated:

"As a signatory to the Chemical Weapons Convention, China is very serious about its international obligations thereunder. Despite the fact that the Convention has yet to take effect, China has committed itself publicly not to produce or possess chemical weapons, nor does it export chemical products that may be used for the purpose of making chemical weapons. In order to ensure that the chemicals it exports will not be used for chemical weapons, the Chinese Government has formulated extremely stringent measures to control its chemical exports. As to the two chemicals referred to by the U.S. side, the Chinese Government has clear-cut orders against their export to certain regions. The Chinese Government will, as always, strictly observe its international obligations and make its contribution to safeguarding international peace and security and promoting normal economic and trade exchanges among countries." [Statement by the Chinese Ministry of Foreign Affairs on the Yinhe incident, 4 September 1993.]

Despite this statement, reports and allegations about China's chemical exports to Iran and the Middle East have continued. In November 1996 it was reported that China sold about 400 metric tons of chemicals (including carbon sulfide) used in the production of nerve agents and riot-control and tear gas to an Iranian chemical center. Also in 1996, the US Central Intelligence Agency reported that Iran "obtained considerable CW-related assistance from China in the form of production equipment and technology" and that "Iran obtained the bulk of its CW equipment from China and India." One such instance involved a 1996 delivery of two tons of calcium hypochlorate, a chemical used for decontamination, and an additional 40,000 barrels in January or February of 1997. [Anthony Cordesman, Iraq and the War of Sanctions, Westport: Praeger Publishers, 1999; CIA, "The Acquisition of Technology Relating to Weapons of Mass Destruction and Advanced Conventional Munitions--July-December 1996," June 1997.]

In addition to US concerns about Chinese chemical exports to Iran, there have been reports that Chinese companies may have aided Iran's biological weapons program. The first such statement was made by US Secretary of State Madeleine Albright, in her 8 January 1997 written answers to questions by Senator Robert E. Bennett (R-Utah). Albright's response stated: "We have received reporting regarding transfers of dual-use items from Chinese entities to Iranian government entities which raise concern," and that the United States has "encouraged China to adopt comprehensive and rigorous export controls" to prevent assistance to Iran's biological weapons program. According to a US intelligence official, China sold Iran dual-use equipment and vaccines with both civilian medical applications and biological weapons applications. [Bill Gertz, "Albright concedes 'concern' over China-Iran transfers," Washington Times, 24 January 1997, p. 6.]

US officials have explained that China's difficulty in controlling exports of chemical items stems from the under-developed nature of its export control system. Many of China's laws, while on the books, are not adequately implemented or enforced. In April 1997 testimony, Deputy Assistant Secretary of State Robert Einhorn stated:

"We...welcome China's adoption in December 1995 of its chemical export control regulation and the supplement to that regulation issued in March of this year. We are deeply concerned, however, by the discrepancy between these positive steps and substantial information available to us that various Chinese entities have transferred chemical precursors, chemical production equipment, and production technology to Iran, which we expect will use them in its chemical weapons program, one of the most active in the world today."
"These dual-use chemical-related transfers to Iran's CW program indicate that, at a minimum, China's chemical export controls are not operating effectively enough to ensure compliance with China's prospective CWC obligation not to assist anyone in any way to acquire chemical weapons. We have raised our concerns frankly with Chinese officials and urged that they take vigorous steps to restrain the activities of Chinese entities from assisting Iran's CW program and to strengthen China's chemical export control system. No responsible party to the CWC can afford to take a "see no evil, hear no evil" approach to export controls. We have also told the Chinese that we are actively examining the questionable transactions of which we are aware with a view to determining whether they meet the requirements of our sanctions law." [Testimony by Robert J. Einhorn, Deputy Assistant Secretary of State for Nonproliferation, Before the Subcommittee on International Security, Proliferation, and Federal Services, Senate Committee on Governmental Affairs, 10 April 1997.]

About one month after Einhorn's testimony, the United States imposed sanctions on Chinese and Hong Kong entities and individuals for chemical weapons-related sales to Iran, included nerve gas precursors such as thionyl chloride, dimethylamine and ethylene chlorodydril; yet the US government admitted that that there was "no evidence that the Chinese government was involved." An October 30, 1997 article in the Washington Times, citing a classified US intelligence report, indicated that China in June 1997 had completed of a dual-use factory that produces glass-lined equipment. Such equipment can be used to produce chemical weapon precursors; export of such equipment is controlled by the Australia Group which China refuses to join (arguing that the AG controls are in conflict with the CWC.) The Chinese company which constructed the factory was the Nanjing Chemical and Industrial Group, one of three Chinese companies sanctioned by the United States in May 1997 for chemical exports to Iran. It was also reported that a Chinese citizen known as Q. Chen was "a major supplier of glass-lined equipment and chemicals to Iran's chemical weapons program." In the view of the US government, this type of cooperation with Iran would constitute a violation of China's commitments to the CWC .

On 30 October 1997, in response to a question concerning the reported Chinese transfer of a dual-use chemical equipment factory to Iran, US Department of State spokesperson James Rubin stated:

"For several years now, the United States has made clear its concerns about the inadequacies in China's system for controlling chemical-related exports. Moreover, we have long made clear our concern that these inadequacies have been exploited by Iran to obtain equipment and technology for its chemical weapons program. Indeed, in May 1997, the US imposed trade sanctions on seven Chinese entities, including one mentioned in today's story, for assisting Iran's chemical weapons program by providing precursor chemicals and chemical production equipment and technology."
"These activities predated China's accession to the Chemical Weapons Convention, which obligates China not to assist anyone in any way with chemical weapons activities. Since acceding to the Chemical Weapons Convention, China has made some improvements to its chemical export controls. But we still believe it needs to do more. We have urged China to make such improvements, and will continue to do so."
"The point is that the company involved is one that we were very concerned about, and we have now received additional assurances from the Chinese that that company's activities will be monitored much more closely and therefore, some of the concern that may have led some people to worry about this particular issue should be ameliorated." [US Department of State, Daily Press Briefing, 30 October 1997.]

In response to these allegations, the Chinese government has stated that it never violated the CWC, and point out that that the CWC explicitly allows for normal trade and cooperation between State Parties (of which Iran is one) in the chemical industrial field. In the Chinese view, the US domestic laws which restrict trade based on decisions by the Australia Group or that specifically target CWC State Parties such as Iran are themselves in direct violation of the Convention.

Despite China's assurances and apparent efforts to improve controls on chemical items, reports continue to surface about Chinese exports of chemical weapon materials to Iran. In 27 May 1998 a report by the Sunday Telegraph reported that China had supplied Iran with 500 tons of phosphorus pentsulphide in 10 consignments of 50 tons each for an estimated $924,000. The chemical can be used for pesticides, but also can be used as a primary component in the production of chemical warfare agents such as VX. The secret deal was reportedly concluded in April 1998 and negotiated by Iran's Defense Industry Organization and the Tianjin branch of China's SinoChem Agency. Iran has categorically denied these allegations. It remains uncertain whether the government knew about this particular transfer. [Con Coughlin, “China Helps Iran to Make Nerve Gas,” The Sunday Telegraph, 24 May 1998; “Iran Denies Report of Chemical Arms Shipment from China,” Agence France-Presse, 27 May 1998.]

CONTINUING CONCERNS AND PROBLEMS

Concerns about China's assistance to Iran's CW program continue. In 2000, evidence emerged that Chinese companies continued to sell chemical weapon related production equipment to Iran chemical weapon related production equipment. In June 2001, the State Department announced that sanctions had again been imposed on the Jiangsu Yongli Chemicals and Technology Import and Export Corporation, a Chinese firm also identified in the 1997 imposition of sanctions. According to the State Department's public notice, which quietly announced the measure, the new action was based on Sections 2 and 3 of the Iran Nonproliferation Act of 2000. These sanctions included a ban on all transactions between the company and any US government entities, as well as a suspension on all transfers between the company and any US firm. [Department of State, Bureau of Nonproliferation, “Imposition of Nonproliferation Measures Against a Chinese Entity, Including Ban on US Government Procurement, Public Notice 3707,” 18 June 2001, in the Federal Register, vol 66 no. 123, 26 June 2001]

In reaction to these sanctions, China's Ministry of Foreign Affairs Spokesperson Zhang Qiyue stated that China administered exports in strict compliance with the CWC, and refrained from exporting chemical materials, technology and equipment that can be used for chemical weapons purposes. With regards to Jiangsu Yongli, Zhang specifically stated that: "We believe that the company has engaged in normal trade in the international chemical industry... They abide by the purposes and aims of the convention." Reiterating the Chinese disapproval of US domestic laws that they view as contrary to the CWC, Zhang continued that: "No country has the right to impose its domestic laws upon international laws ... China strongly opposes the sanction and asks the United States to withdraw it." ["Foreign Ministry Spokesman Demands US Remove Sanctions on PRC Firm" Xinhua News Agency, 28 June 2001, from FBIS CPP20010628000138, 28 June 2001; and "U.S. Sanctions of Chinese Company Unwarranted" from the Website of the Chinese Embassy in Washington DC] This statement is a criticism of US laws based on Australia Group (AG) guidelines, which are more restrictive than what is stipulated in the CWC, and singles out an OPCW State Party (Iran). As the AG is not universally accepted, the Chinese argue that national legislation of OPCW State Parties should be based on the CWC, and supersede any rules based on the AG. The Chinese see US laws such as the Iran Nonproliferation Act as a form of non-compliance with the CWC, which does not allow for discriminatory practices between State Parties with regards to trade in dual-use items.

For other information on China and CBW, see:

[CHRONOLOGY OF BIOLOGICAL WEAPONS-RELATED STATEMENTS AND DEVELOPMENTS]

[CHRONOLOGY OF CHEMICAL WEAPONS-RELATED STATEMENTS AND DEVELOPMENTS]

[CHINA AND THE CHEMICAL WEAPONS CONVENTION (CWC)]

[CHINA AND THE BIOLOGICAL WEAPONS CONVENTION (BWC)]

[CHINA AND THE GENEVA PROTOCOL]

[CHINA AND THE AUSTRALIA GROUP (AG)]

[CHINA'S EXPORT CONTROLS]

This material is produced independently for NTI by the James Martin Center for Nonproliferation Studies at the Monterey Institute of International Studies and does not necessarily reflect the opinions of and has not been independently verified by NTI or its directors, officers, employees, agents. Copyright © 2007 by MIIS.